Adidas Business Research Design: Customer Value and Innovation

This essay provides an analysis of Adidas' business strategies, focusing on customer value proposition, innovation, and its position in the Australian sportswear industry. It identifies barriers faced by Adidas and the industry, such as changing customer demands and high competition. The essay also discusses how Adidas uses innovation and customer-centric approaches to enhance its business, referencing HBR articles to support its analysis of customer relationship management and value creation. The study emphasizes the importance of understanding customer priorities and adapting to socio-economic changes for sustainable growth. Desklib offers a wide range of similar assignments and study resources for students.

Running head: BUSINESS RESEARCH DESIGN
BUSINESS RESEARCH DESIGN
Name of the student
Name of the university
Author note

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Table of contents
Introduction......................................................................................................................................2
Industry and company......................................................................................................................2
Barriers faced by Australian Sportswear industry...........................................................................3
Business enhancement: Customer, Innovation and future..............................................................4
HBR article 2 know your customer.................................................................................................8
HBR article 3 manage customer......................................................................................................8
Current customer value proposition...............................................................................................10
Conclusion.....................................................................................................................................10
Reference list.................................................................................................................................12

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Introduction
Customer value proposition has become one of the important strategic tools that has
become necessary for the emerging business conditions. In case of ensuring the positive
engagement of the customers towards organizational growth process, it has become important for
the companies to focus on promoting effective offers to the customers so that the purchasing
behavior of them will get influenced (Payne, Frow and Eggert 2017). I have been working in
Adidas for last five years and based on by analysis I must say through the introduction of
innovation the company, it has brought various improvements in the market. However, in the
current market scenario, introducing the effective strategic initiatives have become necessary so
that the better opportunities can get introduced in the market.
The purpose of this study is to shed light on three journals and analyze the strategies
implemented in these articles. Analyzing the emerging situation of the company in the
competitive business environment, the study has focused on highlighting the strategic
implications of these articles, in terms of creating value for Adidas in the Australian market.
Industry and company
Over the last five years, the Australian fitness and clothing industry has got flourished
(Forbes.com 2019). The changing demands as well as buying attitudes of the customers’ has
brought significant impact on the active wear industry. It is true that due to changing
consumption behavior of the customers the market size of sports and apparel industry has got
increased. In the Australian sports market, increasing engagement of large numbers of athletes
on the promotional activities, intense market competition has been introduced (Forbes.com
2019). It can be said that the sportswear companies have focused on introducing different

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innovation initiatives in the market. After the globalization, fashion trends among the customers
have got changed. In the current scenario, increasing health concerns among the customers, has
impacted on the sports and apparel industry. In between the year 2018 and 2019, the industrial
growth has got reached 13.7% which is compared to the sales amount of $201.8 million
(Ibisworld.com.au 2019). Online shopping acceptance among the customers has also brought
huge impact on the growth rate of Australian Sportswear industry. In the running year near about
9.5% growth rate has been increased (Sportspeople.com.au 2019). It is true that from the last five
years, increasing ecommerce transactions have influenced the overall growth in this sector.
The study has focused on Adidas multinational company that was introduced in the
market in the year 1970 (Adidas.com.au 2019). In the initial stage, the company has focused on
manufacturing the standard quality of products in the market. It has been identified that Adidas
has brought the hottest trends in the Australian sports industry. The company has contributed
10% in the Australian sportswear industry (Sportspeople.com.au 2019). I have identified that the
situation so that the current so that the situation in that introducing the top line expansion
strategy in the year 2018, the company has established its strong position in the Australian
market and created threats for Nike and Under Armour.
Barriers faced by Australian Sportswear industry
It has been identified by me that although the Australian sports industry has got
flourished over the last 5years, but it is also true that due to changing demand trends, it has
become challenging for maintaining sustainability in the market.
 It has been identified that with increasing opportunities in the market, reaching the
expectation of fans has become challenging for the companies (Theroar.com.au 2019).

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 In the commercial ground high competition has influenced the cost of product and
services, which has indirectly impacted on the consumption behavior of the customers.
 In the year 2016, the consumption behavior of the customers has got influenced due to
the increasing digital access in the sports industry. As its result, retail business sector has
got affected (Theroar.com.au 2019).
Barriers faced by Adidas in Australian market
 In the distribution area of marketing, Adidas has faced several challenges, which
negatively impacted on its business expansion strategy (Adidas.com.au 2019).
 Being the part of modern contemporary society, Adidas has faced high competitive threat
in the global playing field.
 Although large numbers of people have got interest towards the fitness industry,
however, in order to make the sustainable position in the market, more demand is
required, which has become the important barrier for the company.
Business enhancement: Customer, Innovation and future
Analyzing the business expansion strategy of Adidas, it has been identified that
increasing health consciousness and changing consumption behavior of the customers have
impacted on the changing behavior of them. In the Australian market, the company has
introduced diversified range of products for men’s women’s and boy’s. In case of encouraging
the sports enthusiast people, the company introduced ‘Black Friday 2019’ (Adidas.com.au
2019). In this day, introducing special discounts to the customers the company aims to reach
both the emotional and logical needs of the customers. In order to create value in the market,
exploring the Adidas shopping App, the company has ensured high productivity in the market

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(Adidas.com.au 2019). In order to develop strong relation with the customers, the company has
introduced pre sale offers through Glitch app in the year 2018. Through this app, adding
additional codes for 30% off, the company has higher its discount rates, so that large numbers of
customers will get involved into the growth process.
Adidas can be considered as the athletics giant, which has ensured its secure position in
the competitive market with its unique innovation initiatives. Introducing the environment
friendly innovative ideas as well as new technologies in the market the company has successfully
expanded its business in the global environment. It is true that following the sport lifestyle
market, the company has introduced heels in its products. Recently the company introduced
deodorants, aftershave, eyewear, watches, lotions and perfumes (Adidas.com.au 2019). Adidas
introduced Copa Mudial football boot, which has helped the company to introduce Pro Model
shoes and Superstar shoes. Through the central message of ‘Impossible is nothing’, adidas
launched its global campaign in the year 2004. In order to beat the limit in sports market, Adidas
introduced its partnership with designer Stella McCartney (Adidas.com.au 2019). It has been
identified by me that in the year 2002, with the heavy involvement of Adidas in Basketball world
cup, it has ensured its stronger presence in the global market.

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Customer value proposition
Job to be done
Target customer
Offering
Profit formula
Margin model
Resource velocity
Cost structure
Revenue model
Key resources
Technology
Products and services
Brand
Partnerships
Employees
Key processes
Norms
processes
Metrics and rules
Operational
Figure: Elements of successful business
(Created by author)
In order to ensure its sustainable position in the market, following the above business
elements, Adidas aims to ensure its sustainable position in the market. It is true that in order to
ensure the business expansion, I must say Adidas needs to focus on dealing with its strategic
circumstances.

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1. Adidas needs to focus on improving its competitive strategic analysis process so that the
company can be able to gain competitive advantage in the market.
2. Rapid changes in socio economic status of global customers, the changing consumption trends
can create negative impact on the growth process of the company. In this situation, developing
an effective business model can help Adidas to ensure its future expansion.
HBR article 1
In the current business scenario, Customer value proposition can bring significant impact in
case of managing the satisfactory benefits that can help the organization to ensure customer
engagement. Analyzing the article, it has been identified by me that in case of generating the
organizational value in the market, customer relationship management is important. It has been
identified by me that business expansion has become necessary for adidas in terms of
maintaining the global operations (James, Narus and van Rossum, 2006). In that case, I believe,
adidas can focus on adopting the tangible point based expansion strategies. In the research paper,
ample amount of data processing approaches have been identified, which have considered the
following questions-
 How can promotional strategies can impact on enhancing the value proposition of the
company?
 What is the impact of best pricing strategy for enhancing customer segment?
 How the customer favorable points can influence the purchasing behavior of them?
In this article, it has been mentioned that customer relationship management can be
considered as the important component in value creation process. Being the part of Adidas from
last few years, it has been identified by me that changing fashion trends has impacted on the

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behavioral characteristics of the customers. In this situation, satisfying the emotional needs of the
customers have become necessary for Adidas. In this situation adopting promotional initiatives
for promoting the exiting offers, customer engagement can be ensured (James, Narus and van
Rossum, 2006). By continuing this, it can be said that introducing different research and
development initiatives integrity can be maintained. In terms of demonstrating the customer
value, understanding the customer priorities has become necessary. Analyzing this article, it has
also been identified by me that Adidas can focus on customer engagement rather than gaining the
competitive advantage.
In case of gaining larger customer segment, Big pricing strategy can be adopted by the
company. Adidas can ensure its sustainable market position, it is important for Adidas to focus
on effective market analysis process for identifying its substitutes in the market (James, Narus
and van Rossum, 2006). Offering point elements needs to be analyzed by the management for
introducing the systematic approach in the value proposition process. It is true that based on the
adoption of cost saving strategy, the company can ensure its sustainable position in the market.
On the other hand, it is true that incase of dealing with the current challenges in the market,
ensuring customer engagement Adidas can be able to improve its performance management for
satisfying the customer needs (James, Narus and van Rossum, 2006).
HBR article 2 know your customer
In this section of the paper I would discuss the manner in which the business corporations
can take the help of theoretical knowledge propounded in the articles and scholarly for the
enhancement of the prospects of their business. The business corporation which I have selected
for this analysis is Adidas and the article that I have selected is “Know Your Customers’ ‘Jobs
to Be Done’” by Clayton, Christensen, Taddy Hall, Karen Dillon and David S. Duncan.

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Christensen et al (2016) in this article focus on the manner in which the different recent
innovation on the one hand had enhanced the growth rate of the business corporations and on the
other hand had even led to their failure as well. For instance, the article clearly indicates that
more than 84% of the global leaders or for that matter the executives consider innovation to be
one of the key drivers of the success that they have been able to attain whereas more than 94% of
the global leaders or the executives are highly dissatisfied with the innovations which their firms
are using and think that it had slowed down their growth rate.
Christensen et al. (2016) have noted that the situation becomes even grimmer when the
aspect of the selection of the customer base or for that matter gaining a basic idea regarding the
tastes or the preferences is being taken into account. In this relation, it needs to be said that the
article clearly shows the pitfall of relying too much in the usage of the processes of big data
analytics, market researches and others which the majority of the business corporations like
Adidas and others commonly take the help of for the purpose of gaining a better understanding
of the needs or the requirements of the customers for whom they are designing the products or
services. Christensen et al. (2016) explicitly states that rather than taking the help of different
kinds of innovations for the purpose of gaining an understanding of the customers, the business
corporations need to understand the things which the customers try to achieve through the
purchase of a particular product or services.
This dictum of Christensen et al. (2016) in the article under discussion here becomes
especially important from the perspective of the business corporation Adidas which is presently
trying to launch a new line of sportswear in the nation of Australia. As per the precepts of this
article, the business corporation under discussion here rather than merely focusing on the
correlations derived from the different kinds of market researches, big data analytics and others

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which are intended to help it understand the needs or the requirements of its customers, Adidas
should focus on understanding the motivations or the things which the customers would try to
achieve through the purchase of the sportswear that it would launch. Adidas needs to design the
sportswear keeping the results of this analysis into perspective and I think that it would also help
the concerned business corporation substantially if it highlights these aspects of the sportswear in
the marketing advertisements which it would use for the promotion of the same.
HBR article 3 manage customer
In the current business scenario, customer centric business practices has become
necessary in terms of introducing innovation in the market. In the article, it has been identified
that in terms of understanding the innovation directions, most of the companies have focused on
investing research and development initiatives (Selden and MacMillan 2006). Previously,
following the traditional innovation approaches, the companies have focused on introducing the
innovative product development strategy, however, in the modern innovation approach, rather
than focusing on the goods, companies have become highly concerned about the service
providing approaches. Identifying the growth gap in different sectors, it has been identified by
me that instead of understanding the needs and demands of the customers, the companies have
focused on investing in the research and development labs. In this article, it has been identified
that -
‘Employees play an essential role in case of introducing the customer centric research and
development initiative’.
In order to maintain the disciplines in research and development process, the companies
need to focus on effectively allowing the employees for blocking the disruptive threats. In the

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article, it has been identified that in order to gain knowledge regarding the competitive advantage
in the market, the company can focus on adopting the cust0omer centric approach (Selden and
MacMillan 2006). Analyzing the competitive environment in the Australian market, it has been
identified by me that depending on adopting this approach it can be easier for Adidas to give
tough competition to Nike.
‘In case of adopting the customer centric approach, a company can make difficulties for
competitors to analyze its business strategies.’
In case of Adidas, if the company will focus on adopting the customer centric approach,
it will not only influence the performance improvement process, but also it can help to give
tough competition to its competitors (Selden and MacMillan 2006). In that case, by redirecting
the investment process from traditional research and development to customer centric business
practices, Adidas can be able to create tough competition for its competitors.
‘How to improve innovation?’
In this article, it has been identified that based on the budget of the company, Adidas can
improve its research and development initiatives by understanding the exceed expectation of the
customers (Selden and MacMillan 2006). Rather than focusing on traditional business
approaches, Adidas can introduce classify the functions of all the departments and set individual
targets for them. By cutting the budget from research and development labs, the company can
focus on analyzing the overall business lags. This initiative of the company can play an
important role for establishing the core value of the company in the market. Communicating with
the customers is important for intri9ducing value proposition for thee target market (Selden and
MacMillan 2006).